Correlation Between Samsung Electronics and Keros Therapeutics
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and Keros Therapeutics at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Samsung Electronics and Keros Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Samsung Electronics Co and Keros Therapeutics, you can compare the effects of market volatilities on Samsung Electronics and Keros Therapeutics and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Samsung Electronics with a short position of Keros Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Keros Therapeutics.
Diversification Opportunities for Samsung Electronics and Keros Therapeutics
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Samsung and Keros is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Keros Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Keros Therapeutics and Samsung Electronics is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Samsung Electronics Co are associated (or correlated) with Keros Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Keros Therapeutics has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Keros Therapeutics go up and down completely randomly.
Pair Corralation between Samsung Electronics and Keros Therapeutics
If you would invest 4,060 in Samsung Electronics Co on August 24, 2024 and sell it today you would earn a total of 0.00 from holding Samsung Electronics Co or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Samsung Electronics Co vs. Keros Therapeutics
Performance |
| Timeline |
| Samsung Electronics |
| Keros Therapeutics |
Samsung Electronics and Keros Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and Keros Therapeutics
The main advantage of trading using opposite Samsung Electronics and Keros Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, Keros Therapeutics can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Keros Therapeutics will offset losses from the drop in Keros Therapeutics' long position.| Samsung Electronics vs. Copa Holdings SA | Samsung Electronics vs. United Airlines Holdings | Samsung Electronics vs. Delta Air Lines | Samsung Electronics vs. SkyWest |
| Keros Therapeutics vs. Ideaya Biosciences | Keros Therapeutics vs. AnaptysBio | Keros Therapeutics vs. MeiraGTx Holdings PLC | Keros Therapeutics vs. Janux Therapeutics |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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